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AMD Emerges From Intel's Shadow With Big Bet on Low-Power Chips

AMD is designing new server chips based on the ARM architecture, the same architecture used in most smartphones and tablets.

Photo: Courtesy of AMD

Most people know AMD as the company that clones Intel's computer chips. But AMD's top execs want to change that.

On Monday, the AMD top brass laid out the company's plan to build a new generation of microprocessors that have more in common with your smartphone than the chips Intel builds for desktop PCs, laptops, and servers. Rather than stick with Intel's venerable x86 chip architecture, AMD will use the low-power ARM architecture as the basis for its newest server processor, a chip due out later this year codenamed Seattle. But this chip is just a prelude to a broader shift in strategy at AMD.

AMD also said that it has signed a new licensing agreement – an "architecture license" – that means it won't merely adopt the existing processor cores designed by ARM, the Intel competitor whose architecture is used in most smartphones and tablets. Instead, AMD will build its very own ARM core and use it as the basis for a still newer processor code-named K-12. "It's about how do we really innovate in our compute cores," said Mark Papermaster, AMD's chief technology officer, speaking at a press event in San Francisco.

>The announcement is part of a broader effort to adopt ARM's low-power architecture for servers, the machines that drive our internet services and online business software.

The announcement is part of a broader effort to adopt ARM's low-power architecture for servers, the machines that drive our internet services and online business software. Chip makers AppliedMicro and Marvel are moving down a similar path, and rumors indicate that Amazon may design a ARM processor for use in the servers that underpin its massively popular cloud service. The idea is that ARM chips will not only reduce power inside large web companies and other businesses, but also provide some much needed price competition for Intel, which is by far the world's primary supplier of server chips.

AMD's is putting its top server chip developers on the K-12 project. And Papermaster, who's leading the charge, has quite the pedigree. He's the guy who helped Apple design its own ARM chips for the iPhone and iPad before coming over to AMD. Even the chip's code name signals that ARM is serious about AMD, says Kevin Krewell, a chip analyst at Tirias Research. "Calling it the K-12 is important because the K series is always their premium product," he says.

It's the kind of bet AMD needs to make in order to gain ground against its longtime rival Intel, which has been beating it soundly in the server market for the better part of the past decade. But it's also a risky bet. Calxeda, another startup with a similar idea, went out of business late last year, after burning through an estimated $90 million in VC money.